What does “TMS” Really Mean?

Gartner, Inc. recently released the 2019 Magic Quadrant for Transportation Management Systems* that examines many of the multimodal TMS systems on the market today (get a complimentary copy of the report here). According to the report, this is how the multimodal TMS market is defined:

“Multimodal domestic transportation management systems (TMSs) are a subset of the global TMS market. They generically refer to the category of software that deals with the planning and execution of the physical movement of goods across the supply chain.”

And then….

“TMS suites can include all transportation management functions across multiple modes (depending on the level of complexity — see Note 1), such as strategic planning, strategic freight sourcing and procurement, planning and execution, visibility and performance management, and freight payment and audit capabilities. TMSs provide support for multiple modes of transportation, adding deeper support for modes such as small package or parcel shipping, private fleet planning and execution, intermodal, and rail. TMSs embrace global logistics functions and features and continue to broaden their capabilities through partnerships with visibility vendors, carrier networks and freight marketplaces.”

Lots of vendors call their software a TMS, whether it’s a system from an ERP provider, a multi-carrier parcel provider, or rating engine/transportation execution provider. “TMS” has come to mean many different things, but it’s most helpful to look to at the class of solutions we call “multimodal TMS.” A multimodal TMS should include routing, rating and mode selection for multiple modes. This class of solutions addresses a core set of business issues, including 1) routing and rating the orders 2) executing the shipments and loads across multiple modes 3) tracking and tracing the loads and 4) freight settlement.

We expect that TMS definitions will continue to evolve, but a straightforward classification would greatly simplify the selection process. By creating a narrower category for multimodal TMS, you can start to whittle down the list of software providers capable of covering multiple modes while effectively planning and executing your transportation function.Note: For the second time in a row, 3Gtms was positioned in the Niche Players Quadrant of the Gartner Magic Quadrant for Transportation Management Systems. Go here to get the full report.  

*Gartner “Magic Quadrant for Transportation Management Systems” by Bart De Muynck, Brock Johns and Oscar Sanchez Duran, March 27, 2019.

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